A SHIFT IN TOBACCO MARKET CONSUMER DEMANDS

New data has revealed some category shifts within the overall tobacco market. How will it impact your business?

Cigarettes, smokeless tobacco products and electronic cigarettes all experienced growth over the recent four-week period, but each category is growing at an immensely different rate.

Cigarettes

New Nielsen Data reported by Wells Fargo Securities has revealed that cigarette dollar sales increased slightly over the recent four-week period. During the four-week period ending Aug. 13, 2016, cigarette dollar sales increased 1.1%. Category growth was driven by solid 3.1% price increases, while worsening volume dragged overall sales down.

Reynolds American Brands

Wells Fargo reported that Reynolds American continues to grow, as cigarette dollar sales were up 1.5% in the recent period, outpacing the industry’s 1.1% growth. Strength in Newport, which experienced 3.8% growth, and strong 3.6% pricing were able to offset the -2% volume declines.

Altria Brands

Altria Group also experiences cigarette dollar sales in the recent four-week period, according to Wells Fargo Securities. Driven by strength in Marlboro and strong 2.5% pricing increases, Altria’s dollar sales increased 0.9%. The strong pricing and strength in Marlboro was partially offset by soft volumes.

Imperial Brands

The Nielsen Data reported by Wells Fargo Securities suggested that Imperial Brands’ dollar sales are improving, but they remain under pressure, as the brand’s cigarette dollar sales were down, but improving slightly from -1.6% to -1.5%. Substantial volume declines continue to drag down dollar sales, while the company continues to attempt to offset these declines with strong 3.4% price increases.

Smokeless

According to Wells Fargo Securities, smokeless tobacco dollar sales trends continue to reflect a category shift back to combustible tobacco products. Smokeless tobacco dollar sales grew 4.9% in the recent period, which is a marked decline from the December high of 8%. Wells Fargo believes that these declines indicate continued shifts back to combustible cigarettes by the adult tobacco consumer.

Electronic Cigarettes

Electronic cigarettes displayed the strongest growth of all tobacco categories with an increase of 16% in dollar sales. Wells Fargo Securities is attributing this impressive growth to the positive consumer response to recent format enhancements and ongoing innovation. Both volume and pricing were up for this category during the recent period.


We, at TheCstoreEstore.com, are here to assist retailers by providing the largest selection of tobacco fixtures and cigarette displays, and offering retailers the fixtures and point of sale products that they need to keep cigarette, tobacco and smokeless sales a viable and profitable category.

Visit our website to view a full range of tobacco fixtures and cigarette displays. With the exception of custom units, all pricing is disclosed on our website and online ordering is very simple. Call us and we’ll provide you with immediate pricing for all custom units.

TheCstoreEstore.com

(866) 630-2100
sales@cademanenterprises.com

Adapted from “Consumer Demands Shift in Tobacco Market”,  August 23, 2016 CSD Staff 

Jim Richards

Jim Richards is the Managing Member of CADEMAN ENTERPRISES, LLC and founder of "TheCstoreEstore.com", the leading online distributor of cigarette racks, tobacco fixtures and cigarette display cabinets and the exclusive manufacturer of M-Series Overhead Cigarette Racks.

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